Prospect Theory, Loss Aversion
The Leap or Stay
The Leap or Stay is a Prospect Theory and Loss Aversion scenario. The core lesson: Your brain weights the possible loss of the known roughly twice as heavily as the gain of the new. A recruiter calls with an offer: 25% more money, a clearer path to the role you actually want, but longer hours and an unknown team. Your current job is safe, familiar, and 'fine.' The offer expires in five days. DecisionPlay maps the players, payoffs, and equilibrium dynamics that shape how this situation typically resolves.
The situation
A recruiter calls with an offer: 25% more money, a clearer path to the role you actually want, but longer hours and an unknown team. Your current job is safe, familiar, and 'fine.' The offer expires in five days. Everyone you trust gives different advice.
Background
Kahneman and Tversky's Prospect Theory (1979) documents that losses loom roughly twice as large as equivalent gains in human decision-making. A 25% raise should feel decisive, and in a spreadsheet it is. But your brain processes it as 'gain $25K' versus 'risk losing stability, relationships, commute patterns, and professional identity.' The asymmetry means the math says move but the gut says wait. Most people who stay in 'fine' jobs report in retrospect that fear of loss, not genuine preference, drove the decision.
What this reveals
Loss aversion as career anchor
Prospect theory doesn't predict that you'll make bad decisions. It predicts that you'll systematically overweight what you might lose relative to what you might gain, even when the expected value of the move is clearly positive. The 'fine' job is the loss aversion trap in career form: not bad enough to force a decision, familiar enough to feel like something you'd be giving up. Most career stagnation isn't caused by bad opportunities. It's caused by consistently choosing the known over the new when the math actually favors moving.
How to counter it: Do the written audit before the gut vote. List specifically what you'd be giving up, not vaguely 'security' but actually: this commute, this colleague, this benefit, this schedule. Then list specifically what you'd be gaining. Then ask: if I had neither of these and had to choose, which would I pick? Loss aversion only works on things you already have. The audit makes the comparison honest.
A question to sit with
What 'good enough' situation are you still in, not because you've chosen it, but because leaving it feels scarier than staying?
Frequently asked questions
- What game theory concept does The Leap or Stay illustrate?
- The Leap or Stay illustrates Prospect Theory, Loss Aversion. Your brain weights the possible loss of the known roughly twice as heavily as the gain of the new.
- What is the situation in The Leap or Stay?
- A recruiter calls with an offer: 25% more money, a clearer path to the role you actually want, but longer hours and an unknown team. Your current job is safe, familiar, and 'fine.' The offer expires in five days. Everyone you trust gives different advice.
- What does The Leap or Stay reveal about how people decide?
- Loss aversion as career anchor. Prospect theory doesn't predict that you'll make bad decisions. It predicts that you'll systematically overweight what you might lose relative to what you might gain, even when the expected value of the move is clearly positive. The 'fine' job is the loss aversion trap in career form: not bad enough to force a decision, familiar enough to feel like something you'd be giving up. Most career stagnation isn't caused by bad opportunities. It's caused by consistently choosing the known over the new when the math actually favors moving.
- How do you avoid the trap in The Leap or Stay?
- Do the written audit before the gut vote. List specifically what you'd be giving up, not vaguely 'security' but actually: this commute, this colleague, this benefit, this schedule. Then list specifically what you'd be gaining. Then ask: if I had neither of these and had to choose, which would I pick? Loss aversion only works on things you already have. The audit makes the comparison honest.
- What is the research behind The Leap or Stay?
- Kahneman and Tversky's Prospect Theory (1979) documents that losses loom roughly twice as large as equivalent gains in human decision-making. A 25% raise should feel decisive, and in a spreadsheet it is. But your brain processes it as 'gain $25K' versus 'risk losing stability, relationships, commute patterns, and professional identity.' The asymmetry means the math says move but the gut says wait.
- How long does The Leap or Stay take to play?
- About 8 min, at core difficulty, across 4 decision points. It runs in your browser with no account and no sign-in.
Keep exploring
More Workplace Warfare scenarios, or browse all scenarios. New to this? Start with how DecisionPlay works or the game theory glossary.
Topics: workplace, career, loss-aversion, prospect-theory, decision-making, season-2